Chinese automotive interior parts manufacturer Kuntai is expanding its global footprint with a $13.7 million (100 million RMB) investment in Morocco. The new facility, operated by its subsidiary Kuntai Hongjing, will focus on producing car floor mats and carpets, integrating research, production, and sales operations in a single location.
Targeting European markets, Kuntai aims to leverage Morocco’s strategic advantages, including geographic proximity to Europe, competitive labor costs, free trade agreements with the EU, and significantly reduced shipping times and logistics costs. Products exported from Morocco also benefit from duty-free access and protection against anti-dumping measures, enhancing cost-effectiveness and competitiveness.
Kuntai, known for supplying global brands including BYD, Audi, Toyota, Tesla, and GM, plans to deploy the Moroccan project in phases, adapting to market and operational developments. The investment will be financed internally without a significant debt burden.
In Q1 2025, Kuntai reported revenues of $178.6 million with a net profit of $900,000. Though the Moroccan investment accounts for less than a quarter of its quarterly revenue, it aligns with the company’s strategy to balance production across China, Mexico, and Morocco, ensuring coverage of major automotive markets in Asia, North America, and Europe.
With international sales representing just 10.95% of Kuntai’s revenue in 2024, the Moroccan venture is expected to enhance global sales and improve overall profitability. The company estimates export gross margins at 35.05%, significantly higher than the domestic margin of 25.55%, and anticipates gains in efficiency, delivery speed, and product diversity through this expansion.
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